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Enterprise development that works - Tshikululu Serious Enterprise Development workshop 2010

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Presented during Tshikululu's first Serious Enterprise Development workshop, which took place on 6 October 2010. Jason Goldberg (founding director, Edge Growth) asks what South Africa can learn from global experience in enterprise development.

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Enterprise development that works - Tshikululu Serious Enterprise Development workshop 2010

  1. 1. Tshikululu / GIBS ED conference Enterprise Development that works 6 October 2010
  2. 2. Introduction to ED Summary of Global ED experience Key success factors for ED that works in an SA context Page 2
  3. 3. ED is growing SMME’s to create wealth and improve quality of life for the poor Provide goods & services to help Grow the local SMEs economy; Grow local Improve lives of overcome create wealth; enterprises the poor constraints to more and better sustainability & jobs growth “The key task is to increase the number of businesses that survive the first few years of establishment and progress to growth and expansion, thus contributing to higher levels of job creation and economic growth” – The DTI Page 3
  4. 4. Examples of different flavours of ED 1 1 Micro Ent: Micro-bakery in informal community • Locally made bread would be more affordable and healthier than mass-produced bread sold in groceries • 1 bread-baker = 400 loaves/day = 1 business = income for 1 family 2 1 Small Ent: Internet Café in Orange Farm • Orange Farm does not have a single internet connection • Students are required to submit assignments via the internet • Costs much time & money taking taxi’s to neighbouring communities to submit 3 Many SME’s: Local Supplier Development Program • Unilever is a major producer and distributor in Vietnam • Business can be more effective, sustainable, and supportive of the local economy by developing a range of sourcing and distribution “partnerships” with local SMMEs 4 Many SGBs: African SME Growth Investment Fund • Sector Specialised Private Equity Fund to finance growth of small, high growth potential small businesses in Africa • Funds under management: ~R375M; 15 investments in 7 years 4 Page 4
  5. 5. Why ED? ED is globally recognised as one of the most powerful weapons to fight poverty Poverty Job Growing must be creation SME’s are ED is fought is central key crucial • Not just a South African idea, or another BEE checkbox • However, more important in SA than many other developing nations – SA is a more difficult environment to create jobs than many other developing countries – BEE Codes provide ~R20Bn for ED, enough to double rate at which jobs are created in SA • Almost certainly the most powerful opportunity for YOU to contribute to building a better South Africa Page 5
  6. 6. Introduction to ED Summary of Global ED experience Key success factors for ED that works in an SA context Page 6
  7. 7. What have we learned from global experience? • 60 years of effort - Governments • Achieving powerful - Development impact is possible specialists (World Bank, IFC, USAID, (several success stories) DFID, etc) • Not easy: most efforts - Corporations fail (Shell, BP, etc) • ED is complex and • 10 years of intensive highly nuanced efforts • Tens of $Bn’s spent Good intentions are not good enough! Page 7 Good practice is essential
  8. 8. Why so little success? Foundationally: political and social design and implementation of ED programs Should be driven by In practice Motive Political and social agenda Political and social agenda Economic and commercial Design Political and social agenda fundamentals Above, plus management Implementation Political and social agenda best practice Target economic Target economic need opportunity (hence, often target areas that lack real opportunity, or kill the opportunity)
  9. 9. Consequently, many ED strategies are divorced from economic realities Non-holistic Inappropriate No growth zones Doomed sectors support SME targeting Description • Emerging SME’s in • SME’s in “doomed • SME’s which face • Supporting start-ups sub-sectors with sectors”, which cannot multiple constraints, in sectors where limited demand compete against global many of which are established growth potential suppliers with a far unaddressed by ED businesses struggle superior value programs proposition due to • OR, supporting inherent competitive • As a result of lingering SME’s in sectors disadvantages (e.g. constraints, SME’s will where only ME’s can cost structure) not grow and realise be successful the value of ED investments Examples • Emerging black • Textiles (excluding • “Outreach” focused • Emerging, niche stationary provider niche players) support textile players, or – Shifts procurement spend – Can never be competitive – Leaves several BPO centres (and jobs) from one with Chinese / Indian other constraints to growth supplier to another dev’ing producers unaddressed • Informal area – Shift destroys economic – Markets will ensure failure – Growth will not emerge supermarket, vs. value (and hence jobs, at of those who compete and jobs will not be spaza shop national level) without head on created unlocking new value – Better impact possible – Hence erodes national providing much help to capital base & diminishes few SME’s ability to invest in job- creating growth Intentions are not enough: several well-intentioned ED approaches, divorced from economic realities, will have no beneficial outcome at all Page 9
  10. 10. Similarly, inadequate focus on picking high human capital entrepreneurs due to imbalanced focus on narrow-based empowerment (on average, poor people benefit 5X versus owner) Socio-economic returns (measurable only) Rands benefit per year, per Rand invested R 0.80 R 0.70 Taxes R 0.60 Society and competitors Complimentary producers R 0.50 Social returns, 0.58 Net customer benefit R 0.40 Local suppliers R 0.30 Other staff benefits R 0.20 Wages R 0.10 Social returns Financial returns, 0.16 Financial returns R 0.00 Socio-economic rate of return Social rate of return • Low income and poor people benefit 2-20X more than owners from successful businesses • Narrow-based SME ownership is at expense the of broad-based job creation. • ED aimed at granting ownership to those with HIGH HUMAN POTENTIAL rather than those with HIGH HUMAN CAPITAL** disadvantages the poor most of all ** NOTE: “It is not about human potential; it is about human capital: that crucial driver of successful enterprise, which is the existing availability in a human soul of education and skill, a swift, creative mind and proactive spirit, and a vision or dream that fuels the constant energy required to “sukkle” through hard times. There is no substitute for the slow process of sowing education and experience to reap human capital, and no substitute for sowing human capital to reap successful enterprise and jobs.” Page 10
  11. 11. Unfortunately, often ED programs have both weak entrepreneurs and weak ED service providers Talented and experienced entrepreneur Inexperienced entrepreneur Known to self Not known to Known to self Not known to self Strong BDS provider self Known to Not known Known to others to others others “On top of it” Blind spot “On top of it” Blind spot Not known to others Facade Unknown Facade Unknown Known to self Not known to Known to self Not known to self Poor BDS provider self Known to “On top Known to others “On top of it” Blind spot of it” Blind spot others Not known to others Not known to others Facade Unknown Facade Unknown Likelihood of fatal mistakes causing business failure Likelihood of success Likelihood of wasted cash and effort Both an effective entrepreneur and an effective BDS Likelihood of wasted cash and effort provider are required for a successful outcome
  12. 12. Finally Few real Obstacles to Obstacles to opportunities: formal informal enterprise are enterprise also profound: profound: Few viable Access to Limited cash in economic opportunities in markets, infrastructure, local economy to create It’s just rural / isolated and and HR capacity are primary markets, or to support micro- hard! underdeveloped limiting factors: enterprises on a areas cannot simply meaningful be solved with scale money Page 12
  13. 13. Introduction to ED Summary of Global ED experience Key success factors for ED that works in an SA context Page 13
  14. 14. ED programs that work in an SA context: In summary Requires a system – i.e. a business organisation set up with a long-term single- minded focus on doing this well, and building a system to do it well Page 14 14
  15. 15. Most of SA’s corporate and government ED programs are currently doomed to mediocrity or failure Do not build systematic organisations built to do this well Page 15 15
  16. 16. Beginning with the basics Be realistic Be focused Set up a holistic solution with right incentives Page 16
  17. 17. Set up a holistic solution with right incentives: 1 To unlock growth you must holistically address all growth constraints outcomes Growth Effort Market opportunity constraint (quality Capital constraints growth markets) (access to finance) Competitiveness “Hunger” constraint Resource constraints constraint (ability to (lack willingness to pay (access to skills, raw materials, sustainably compete) the price for growth) technology, systems, processes, tools, etc) Opportunity constraints Obvious constraints Mgmt capacity constraint Strategy constraint (inadequate resource to (unfocused, inability to effectively plan & execute figure out and focus on what growth) really matters) Overlooked constraints Page 17
  18. 18. Set up a holistic solution with right incentives: 1 Most SME’s will require holistic, long term support to really unlock growth Incremental growth unlocked High Holistic This IS approaches how ED works This is NOT how ED Non-holistic works Med approaches Low Constraint addressed Low Med High Effort / spend to unlock growth Non-holistic approaches are likely to be wasted “investments” Page 18
  19. 19. Set up a holistic solution with right incentives: 1 Many “low touch” approaches simply waste funds “Low-touch” outreach focused Focused, high impact approaches approaches Page 19
  20. 20. Set up a holistic solution with right incentives: 1 Investment funds and incubators are the ideal solution The core ED challenge • Providing quality business support to really grow good businesses (and hence create real social impact) requires sophisticated, experienced input (Business Development Service providers) • Sophisticated support is expensive • SME’s can’t afford it • Outside ED funders (e.g. corporate / state / donors) typically not willing to pay for good BDS • For those that are, paying for good BDS is the most expensive form of ED How do you provide meaningful BDS support, despite the cost? Key principles for success 1.BDS fees need to be at risk: directly linked to success of the firm 2.Hence, most effective models are at-risk incubation and finance models (incubation & finance where most of fees / returns are profit-share linked) ED Models that work well because they apply these principles 1.Missing Middle Finance (intensive growth support wrapped into tailored finance solutions) 2.At-risk incubators (don’t provide finance, but significant portion of fees linked to profits) Page 20
  21. 21. 2 Be focused: Enterprise Development takes countless forms SME target market Micro-enterprises Large corporations Struggling firms Successful firms Specific demographic groups All / any groups Specific industry / sector All / any industries Specific geography All / any areas Support services Discrete problem-solving Holistic business transformation Focus on support processes Focus on core processes Standard services Customer service Short-term, small projects Long term, large projects Delivered in groups Delivered to individual firms Operations Build internal capabilities Rely on outside providers Allow flexibility Maintain tight control Pricing Set prices to buy market share Set prices to maximise profits One price for all customers Customer-specific Page 21 21
  22. 22. 2 Be focused: Some examples of SA ED models Summary description SA Examples Venture • Investment funds which invest alongside management in young, rapidly growing companies •HBD Venture Capital capital with potential to become significant economic contributors •IDC Venture Cap SBU •Anglo Zimele Primarily financial Development • Fund managers (usually government or ODA funded) which provide finance to entrepreneurs •IDC finance and businesses in competitive industries, to promote national socio-economic development •Khula / Ntsika funds SMME Finance • Small banks which provide finance, transactional banking services, and sometimes other •Vumela (FNB / Edge) & microfinance business development services, to micro-entrepreneurs and small businesses unable to •Grofin access funding from commercial banks •Business Partners Business • Walk-in entrepreneurial centre that offers non-financial services, mostly facilitating business •The Business Place (Investec) Primarily non-financial services focus Centres start-up and early stage growth, on a commercial, subsidized, or free basis •SEDA Business • Business centre that offers start-ups and young businesses premises, facilities, and access to •Raizcorp Incubators a suite of on-site services to address constraints to growth (excludes finance). Sometimes •ChemCity (Sasol) sector focused Virtual Business • Companies that offer SME’s of any size a holistic business services solution to enable •Edge Incubators aggressive growth management (excludes facilities and finance) •ChemCity (Sasol) Entrepreneur • Companies that provide young entrepreneurs with primarily personal development services, •Endeavour (NGO) development (including entrepreneurial, management, functional, and personal training / coaching / •SAIE (NGO) consulting) and facilitate learning, networking and linkages to resources •Enablis (NGO) Focused Service • Companies that provide a discrete set of business services (out of the large universe), •The Business Partners Providers including management, functional (e.g. finance, marketing), and technical support, delivered (Mentoring) through training, coaching, mentoring, consulting/advisory, or technology Sector • Consulting organisations which support the development of a particular SME sector by •Technoserve (esp. rural) development addressing constraints at and sometimes beyond enterprise level for a vertically integrated group of enterprises concerned with the same product • Customised model which decisively addresses all 3 areas of dominant SME need (financial, •Edge models Holistic Business linkages market, and operational), through performance-based growth contracts with either suppliers or •RaizCorp distributors, and holistic managed growth support Hybrid models • Any of the dominant typologies, with some added features from other models, but still not able •Edge (many varieties) to decisively address all 3 areas of dominant SME need: financial capital, market access, and •RaizCorp operational development Page 22 22
  23. 23. Be focused: Some examples of SA ED models 2 Relative advantages Relative disadvantages Best suited to support Venture • Provide long term capital to high risk • Expect higher financial rewards, hence require • SME’s in high growth potential industries or capital companies with limited debt access, along lucrative profit potential and equity share new markets, with lucrative profit potential (e.g. with strategic and mgmt support new technologies) Development • Provides long term debt at subsidised / • Typically only available to sectors with great • SME’s in Industries / sectors with Primarily reduced rate to support sectors / industries developmental potential (e.g. high job developmental impact potential, primarily financial finance with greater developmental potential than creation) capital needs, and limited attractiveness to investment potential venture capitalists SMME Finance • Small-scale finance, below commercial bank • High interest rates, driven by costs • Viable MSE’s underserved by banks, with & microfinance lower limits, sometimes at competitive rates • High quality variability primarily capital needs, & ability to meet high, compared to other alternatives monthly repayments Business • Provide low cost access to basic business • Limited selectiveness leads to investment in • Primarily micro-enterprises or start-ups in close Centres skills training and knowledge, for a broad SMME’s with low/no potential geographical proximity (e.g. same suburb / range of SMME’s town), with fairly homogenous, primarily Primarily non-financial services knowledge constraints Business • Provide low cost facilities, basic systems • Require residence ons-ite • Start-up / fledgling SME’s needing low cost infrastructure & affordable access to advice & • Focus on HR development, not so much on facilitates, rapid mgmt development and Incubators mgmt development services (training, enterprise development (advanced business networking consulting, etc) processes, systems, etc) Virtual Business • Similar benefits to business incubators, • Unable to provide low cost access to facilities • Established SME’s with rapid expansion Incubators without residence requirement, & more (e.g. premises, reception, etc) potential, needing rapid mgmt development & / balanced emphasis on enterprise. More or support for major enterprise change flexible than premises-based model programs Entrepreneur • Deep, broad, accelerated personal • Limited or no focus on building the enterprise • Young entrepreneurs, with great development development of entrepreneurs; lasting (systems, processes, technology, etc) entrepreneurial potential, & primarily personal investment in human capital will benefit development needs (can dovetail with other country wherever entrepreneur goes ED models) Focused Service • Specialised providers able to provide deep • Huge variation in quality and offerings; high • SME market with very specific set of skills / support in specific need areas (e.g. costs of selecting most suitable provider and knowledge / advice needs, & sufficient demand focus Providers mentoring) managing many relationships to address all to sustain stand-alone businesses needs Sector • Creates jobs through export growth/ import • Only has positive benefit where • SMME’s in Industries / sectors with development replacement, by making sector more globally competitiveness is achievable (either developmental impact potential or high growth competitive through removing constraints domestically, or on global markets) potential, & common firm- and meso/ macro- beyond firm level level constraints Bus Linkages - • Potential to be more holistic model if added to • Can only be initiated by a corporate ED • Local SME’s in corporate supply chain, where finance and non-fin. services - indirectly partner, with potential to access new markets/ corporate partner is willing to leverage Holistic models Distribution addresses access to markets by providing grow market penetration through growing procurement spend to accelerate local SME access to quality products distributors growth Bus Linkages - • Potential to be most holistic model if finance • Can only be initiated by a corporate ED • Local SME’s in corporate supply chain, where and non-fin services are addressed, since it partner, with an appetite to invest in local corporate partner is willing to leverage Suppliers inherently addresses access to markets suppliers, at a cost procurement spend to accelerate local SME directly growth Hybrid models • Varied – depends on exact nature of hybrid • Varied – depends on exact nature of hybrid • SME’s with more complex needs than model (can draw on aspects of any of above model (can draw on aspects of any of above typologies listed above (e.g. suited to business (many varieties) models) models) incubation, but requiring access to capital & technical skills training) Page 23 23
  24. 24. 2 Be focused: Picking the appropriate ED model is crucial. Know the profile of SME’s you want to support, know their needs, and focus on best model to deliver Survival Successful Emerging SME / SME / Emerging Medium Ent. / Micro Micro 1st Stage growth 2nd Stage growth 3rd stage growth 100% Focus on developing enterprise • Microfinance & (facilities, products, processes, systems, tools, marketing, % of ED activities Micro- ED financial mgmt, human capital, etc) • Seed • Early stage incubation incubation • Expansion finance and incubation (e.g. RaizCorp) (e.g Edge) • Start-up incubation Focus on developing entrepreneur / owner-manager 0% (knowledge, skills, networks, etc) 1 1-5 1-20 Employees 10-50 25-200 Entrepreneur Primarily Primarily Enterprise Development Entrepreneur Enterprise Development Development Development with some with some Enterprise Entrepreneur Development Development Page 24 24 capability capability
  25. 25. 3 Be realistic: Real ED, even simple ED, requires a LOT of effort Case study 1: Super low complexity, super low impact 1 1 Micro Ent: Micro-bakery in informal community • Locally made bread would be more affordable and healthier than mass-produced bread sold in groceries • 1 bread-baker = 400 loaves/day = 1 business = income for 1 family Inputs Outcomes: • 2 months • Successful micro-ED venture • R6k in capital earning enough money to feed a • 25 hours of support from household businessmen earning >R400k p.a • Successful entrepreneur from the • Ongoing support doing accounts: local community ~2 hours per week • Lower cost bread for the community Page 25 25
  26. 26. 3 Be realistic: Real ED, even simply ED, requires a LOT of effort Case study 2: Low complexity, low impact 2 1 Small Ent: Internet Café in Orange Farm • Orange Farm does not have a single internet connection • Students are required to submit assignments via the internet • Costs much time & money taking taxi’s to neighbouring communities to submit Inputs: Outcomes: • 12 months • Successful enterprise creating socio- • 1 highly motivated, very talented, full time economic value in the local community business owner • Successful entrepreneur from the local • R77k in cash capital , plus donation of community satellite connection by IS (big favour!) • 2 full time jobs • 150 hours of support from businessmen • Students and community receiving earning >R1M p.a several valuable services • A few favours Page 26 26
  27. 27. 3 Be realistic: Real ED, even simply ED, requires a LOT of effort Case study 3: High Complexity, high impact 3 Many SME’s: Local Supplier Development Program • Unilever is a major producer and distributor in Vietnam • Business can be more effective, sustainable, and supportive of the local economy by developing a range of sourcing and distribution “partnerships” with local SMMEs Inputs: Outcomes: • “Unilever defined quality standards, established • Unilever’s partnerships with local enterprises the technology input necessary to achieve these support 5,500 local jobs, more than double the requirements, and, where appropriate, provided 2,000 people employed locally by Unilever the financial support Training programs on • 40% of raw materials and 80% of packaging quality standards, inspection and testing materials purchased from local suppliers methods and warehousing specifications were undertaken Unilever provides them with &28M of business each year with guaranteed volume at agreed prices and quality levels” Page 27 27
  28. 28. 3 Be realistic: Real ED, even simply ED, requires a LOT of effort Case study 4: Very high complexity, very high impact 4 Many SGBs: African SME Growth Investment Fund • Sector Specialised Private Equity Fund to finance growth of small, high growth potential small businesses in Africa • Funds under management: ~R375M; 15 investments in 7 yrs Inputs Outcomes • Overhead budget 20% of annual • Deploy ~R60M ED funds / year funds deployed (R12M) (80% finance, 20% other support) • Permanent headcount = 11 • 15 microfinance banks across • 4 dedicated investments officers Africa, providing microfinance assessing and prioritising banking services to millions of opportunities (avg. salary R950k individuals and micro-enterprises p.a) Page 28 28
  29. 29. 3 Be realistic: CSI-oriented organisations tend to be organisationally and culturally incompatible with high-impact programs focused on larger growing businesses Survival Successful Emerging SME / SME / Emerging Medium Ent. / Micro Micro 1st Stage growth 2nd Stage growth 3rd stage growth 100% Focus on developing enterprise (facilities, products, processes, systems, tools, marketing, % of ED activities CSI: ED: financial mgmt, human capital, etc) 1. Specific beneficiaries more important 1. Maximum impact more important than than max impact specific beneficiaries 2. Smaller budgets 2. Larger budgets 3. Less business competence 3. Stronger business competence 4. No appetite for market salaries for 4. Appetite for market salaries of competent professionals competent professionals Focus on developing entrepreneur / owner-manager 0% (knowledge, skills, networks, etc) 1 1-5 1-20 Employees 10-50 25-200 Entrepreneur Primarily Primarily Enterprise Development Entrepreneur Enterprise Development Development Development with some with some Enterprise Entrepreneur Development Development 29 capability capability Page 29
  30. 30. Key takeaways Situation • Enterprise Development (ED) is growing small businesses to create socio-economic impact • ED is recognised globally as a central necessity in the fight against poverty • In SA, BBBEE regulations create a R10Bn – R20bn (est.) market for private-sector driven ED • This has the potential to double the rate at which jobs are created in South Africa! Complication • 60 years of global ED experience makes it clear how difficult it is to get ED right • Most of SA’s corporate and government ED programs are currently doomed to mediocrity or failure Key question • How can we (corporate SA) turn this around and use ED as an effective tool to build the nation? Most crucial principles: 1. Think finance PLUS incubation: provide systematic, medium- to long-term support to unlock growth and jobs 2. Be focused: Pick the right ED model and partners 3. Be realistic: Design a program that matches your organisation’s resources and appetite to really engage for the long-haul Page 30
  31. 31. Jason Goldberg • Jason is a founding Director of Edge Growth - a firm focused on Enterprise Development (ED – unlocking social impact by growing high potential small businesses). • Jason learnt the principles and instruments of identifying and unlocking business growth potential as a consultant with Bain & Company, a global strategy firm which advises on 50% of all large private equity deals done anywhere in the world, and who’s clients have outgrown the S&P 500 by 4:1 over the last 30 years. Jason has facilitated corporate venturing and start-ups, was Investment Principal and C.O.O at a Private Equity Investment Trust investing exclusively in small businesses, has been a Senior Exec in 2 market-leading SME’s, has developed a virtual incubation methodology to unlock growth in high potential small businesses, has developed ED strategies for companies ranging from the world’s largest mines to South Africa’s largest banks, and is now Chief Investment Officer for a Social Impact Private Equity Fund in partnership with First National Bank. • Jason has studied global ED best practice, attended global forums on entrepreneurship and ED and been keynote speaker at several conferences on ED. For example, Jason and has been invited as one of 30 global panel speakers at the watershed Second International Business Forum on Financing for Development in Doha in November 2008, the primary global forum for government, business, and civil society to advance best practice approaches to enterprise development financing • Jason has a degree in Electrical Engineering and a post-graduate degree in Sustainable Development, and is currently researching best practice in Missing Middle finance 31
  32. 32. Edge Growth Edge is passionate about creating a brighter future for all South Africans through explosive SME growth that develops skills, creates jobs, and unlocks other forms of social impact. That’s why we bring together world-class teams, best practice approaches and tools, sophisticated systems, and most importantly the right frame of heart and mind, to focus on unlocking SME growth. Edge’s current focus is in 3 areas: ED Strategy for corporate clients; Impact Investing; and SME incubation. EDGE STRATEGY: We have advised a range of companies, including the world's largest mines and South Africa's largest Banks, on SGB Development strategy and programmes. Our aim in this arena is to channel private sector Enterprise Development funding towards high impact SGB Development delivery vehicles EDGE CAPITAL (IMPACT INVESTING): Edge has recently launched a social venture capital fund in partnership with FNB. The objective is to grow high social impact businesses in South Africa through private equity investment and intensive virtual incubation support EDGE INCUBATION: Together with a SME private equity fund, we developed a methodology to unlock growth in high potential small businesses, in an African 32
  33. 33. Enterprise Development: A golden chance for Alas, BEE is, by default, narrow based (it helps those who least need it), until regulations force a broad the Rainbow Nation based approach. Market logic dictates that it be so: NB BEE is the least cost, highest value approach. History The importance of Corporate Social Responsibility has tells us that only broad based empowerment will rarely been quite as tangible as it is in South Africa prevent a Zim esque decline into a deep and dark social today. Few occasions in history have so thoroughly and economic pit for our balmy nation. It’s not a displayed the mind of man, the soul of society, as political matter; it’s a matter of human nature. People Enterprise Development does in the Rainbow nation in need hope; and if most of the nation finds itself with 2008. These next 5 years will leave a legacy to be lived none and a revolutionary or dictator promises them out by our children and their children, and it will be some, they are likely to follow him/her; and the world glorious or it will be gory; it will emancipate or it will we live in is just crazy enough to make the emergence subjugate; it will inspire or it will shame; and the choice of that revolutionary / dictator inevitable. Narrow is in our hands. based empowerment merely slows the process. Perhaps. Without broad based BEE, the Rainbow The global wealth divide (the gap between the “haves” Nation will inevitably become the Dark Cloud of Africa and “have nots”) is at historical highs it grew by as resentment from the starving masses wells up into roughly 2500% over the last 50 years and social violent revolution. justice efforts are stepping up to combat these gross inequalities. This arbitrary statistic becomes real when Unfortunately, the first five years following the 2002 you consider that in this age of unprecedented release of the BEE Codes of Good Practice saw the affluence and convenience a child under the age of 5 implementation of BEE being very narrow based. starves to death every five to seven seconds. Hence, most savvy South Africans would have guessed in early 2007 that the release of the Broad Based There are good reasons South Africa’s social justice version of the BEE Codes of Good Practice (B BBEE movement finds itself expressed in the Black Economic COGP) would aim to stimulate a shift in the business Empowerment (BEE) effort. Compliments of Apartheid, community’s BEE approach to a truly broad based the wealth divide loosely finds its form in the black / version that helps the vast poor masses. Few would white divide in South Africa. 50% of black people, and realise just how great that shift could be. A single 70% in 2 of our provinces, live on under R8 / day (US$1, change in the Codes would hold potential to alter the or a loaf or two of bread). BEE aims to restore some future of this nation, and fast; and it lay in the semblance of fairness and civil stability to South African unassuming, unknown, enigmatic entity that is society and so also improve business sustainability, by Enterprise Development. compensating for the inherited environmental disadvantages of South Africa’s most poor people, who Enterprise Development (ED), simply speaking, is happen (by vast majority) to be black people. helping small businesses grow in order to create jobs. In South African BEE terms, it is company A spending a 1|Page
  34. 34. portion of its profits to help black empowered businesses. There’s much more to it, of course, but company B grow, hopefully creating jobs. that’s the crux and indispensable centre of it. Ultimately, and without discounting the importance of In the first era of BEE (2002 2007), ED received little parallel welfare approaches and underlying attention beyond some confused frowns. The 2007 B empowerment and security efforts, the provision of BBEE COGP substantially bolstered the importance of more and better jobs is by a long way the most the ED aspect of the BEE Scorecard, increasing its powerful means, not to mention the only sustainable weighting from 10% to 15% and the target spend from means, of attacking poverty; the only sustainable 2% of net profit to 3% of net profit. At the same time, means to create jobs is to expand trade and industry; government began paying increasing lip service to and the only sustainable means to achieve that in broad based empowerment. Confused frowns now developing nations, where small businesses generally turned into worried frowns, as the business community make up 50% 80% of the economy, is to grow small suddenly needed to come to grips with this newly businesses. That’s Enterprise Development: it creates important animal. jobs and, therefore, dignity, hope and justice. Why the emphasis? Why is ED so important? Perhaps And it works too. Several global case studies the best way to make the point is in brief: globally, ED demonstrate how ED can create thousands of jobs in a is the most powerful known weapon to fight poverty short space of time through strategic and concerted and create a vibrant and fair society that creates efforts. A World Bank study in Sri Lanka demonstrated opportunities for more of the poor. After roughly 60 how an ED program accelerated job creation by 30% years of concerted efforts to fight poverty by global amongst supported businesses (5). ED, done well, is a developmental specialists, in which trillions of dollars catalyst for explosive growth, job creation, and social have been spent by many big brains and golden hearts stability. on various forms of international aid and welfare, and many and varied approaches have been tried, the While all this may make ED sound like purely a social global community of development (anti poverty) tax (which is mostly how it is viewed in SA today), done practitioners has arrived in the last decade, for the first well, ED is very good for business and should be used to time, at somewhat of a consensus on how to best fight create competitive advantage. 3% of net profit is a big poverty. Several Iron Curtains and Wide Walls, a expense item (for example, typical investment in number of Socialist States, a raft of white elephant training is only 2 4% of payroll). If your competitors are infrastructural projects with accompanying debt crises, spending it poorly (i.e. doing ED poorly) and you are one prolonged bout of bad Neo Liberalism and a failed effectively using it to create access to new markets or Washington Consensus later, we can finally agree strengthen strategic suppliers (for example), you are thanks largely to some Asian Tigers that the best way investing in competitive advantage. In fact, the most to fight poverty is within a capitalist economy with powerful forms of ED are those which help your strongly pro poor economic policies which aim to bottom line. In many cases, as a contributor to ED with create jobs for everybody by investing in growing small a significant budget, working within your own value 2|Page
  35. 35. chain to grow sales or reduce costs is likely to have “Best Principles”: golden principles without which more job creating impact per Rand invested than any Enterprise Development is likely to fail or deliver other form of ED. miserable, unmeasurable outcomes. Alas, most SA ED efforts observed by edge (a few notable exceptions The good news is that SA’s B BBEE COGP could create aside, such as Sasol’s Chemcity and Anglo Zimele) are sufficient ED investment to double the rate at which being implemented with no regard for the principles jobs are created in South Africa! South Africa needs to that work and, not surprisingly, success stories are few create roughly 600,000 jobs per year to achieve the and far between. It’s not entirely their fault, since the State’s AsgiSA program target of halving South African business community are not ED unemployment by 2014. We only created, on average, practitioners. In addition, ED is far more complex, 280,000 jobs per year between 1994 and 2005 so specialised and challenging than even senior line something simply must change. Fortunately, South manager roles, and it is not their core business. Africa is in the unique position, globally, of having Nonetheless, responsibility lies in their hands to get it regulations which stimulate a market for somewhere right. near R4Bn worth of private sector ED investment (Edge estimates). For example, based on their declared net Both the great tragedy and the golden opportunity lie profit, Sasol alone would need to spend R500Million on in the fact that a handful of enlightened but simple Enterprise Development in 2009. R4Bn worth of private decisions by a few thousand individuals (mostly sector ED investment could create between 40,000 and corporate businessmen, the DTI, and ABVA the 400,000 additional jobs per year, if available global Association of BEE Verification Agencies) would benchmarks of job creation efficiency are anything to radically alter the future of this nation. Even a single go by. decision: let’s do what we must to make ED work. Simply making the decision to invest the effort required In summary, if ED is done well, there is no more and partnering with those who know how to make powerful, sub Divine vehicle to turn our humble ED have an impact on your own business and nation’s potential miracle story into a miracle story. ED sustainably grow job creating businesses is the is central to the Rainbow nation’s solution. beginning of national change. We cannot point to a single other sub Divine project or force that could That’s the good news. The bad news is that, if ED potentially double the rate at which jobs are created in continues to be implemented the way it is being today, this nation. Every decade or so, a single chance comes this opportunity will be squandered with little to show along to make an unparalleled difference to our for it. 60 years of efforts by experienced ED national destiny. ED is it for this decade. And today that professionals has left us with very little measurable chance is being squandered. “My people are destroyed impact and many hard lessons, including that ED must for lack of knowledge”. Well, now we know. The be designed and implemented well if it is to have any question is what will we do about it? impact at all. While ED is too complex to have a “Best Practice”, Edge has identified from global research a 3|Page
  36. 36. Our childrens’ future is shaped by the decisions you and I make today. ED has the unparalleled potential to make the Rainbow Nation a reality: a better nation for all, in our lifetime. The business community has the power to make a handful of simple decisions in regard to how they undertake ED, and so shift the future of this nation from Zim esque gradual decline to Asian style steady climb. Today, those decisions are not being made and our children (and their children) will live out the consequences of our present intent in regard to ED, as we are living out the consequences of Apartheid. We can change course. The future is in our hands. Rarely in global history has Corporate Social Responsibility been so real. Lets step up to the plate and change the nation. Let’s leave a legacy. 4|Page
  37. 37. Women in Enterprise: paradox and choice On the other hand, at a macro level, the “Women in Enterprise”: another great teacher of analytical, strategic mind of Dube - the social Life. A topic which reminds us of the ever present economist with a good brain and better heart who paradoxes in development, forces us to be real takes a big picture view and asks “how can we and confront the unbending ways of Life, and to help the most Noxolo’s with the little resource we get past rhetoric on the pot of gold at the end of have?” - points to the statistics to help us the rainbow and get on with digging for it. Its understand how counterproductive the strategy of trenches aren’t pretty and its board rooms not for placing women at the helm of enterprise is, sissies. pursued as a dominant strategy, if one is concerned with helping many Noxolo’s at all. We’ll leave the task to the rest of this publication to describe precisely what “Women in Enterprise” Who can understand it? The Invisible Hand of the means. Here we will stick to the messy topic of Market dictates the terms of sustainable whether or not and where it is in fact a good economic development and He shan’t be moved thing. by purity of purpose or agony of plea. His purpose is not to redress past injustices; He has The tension really exists (as all too often is the one mission: to continue to reward the profit case) between the macro and the micro, the motive and effective enterprise with success and personal and the strategic perspectives. Much appreciating wealth, and to penalise poor like a married pair, their views disagree enterprise effectiveness, efficiency and fundamentally and both are right! productivity with failure and rapid erosion of the means by which one must achieve all economic On the one hand, at the micro level, supporting ends in this world: capital. He always has. He Women in Enterprise is just so noble and always will. And so to help the weak in a market progressive and necessary and... well, just! For economy we shall always have to help the many long centuries, women were excluded from strong. the economy by culture and regime, so that the most disadvantaged peoples in our broken And so Dube reminds us that empowering our society today are helpless women and their Noxolos is the true end for which we strive, and children. Surely one of the most shameful Women in Enterprise merely the means. He will symbols of our broken society must be the then point out that the best way to help the most multitudes of Noxolo’s. Noxolo is a single young Noxolo’s is to address poverty in general, which 17 year old mother with no skills, no education, is achieved most effectively by supporting no parents, no husband, and no hope but to (directly) not the Noxolos of this world, but the share her bed and body with multiple partners Vuyo’s of this world: the highly skilled, networked, weekly just to put bread on the table for her 2 equipped, successful world-beaters with a trail to toddlers, until she gets sick with aids, her blaze through the open planes of opportunity the boyfriends move on, and she is left with nobody trained and eager eye will see in an emerging but hungry children to feed and growing inability market economy. to muster the strength to still their hungry cries. Before you vomit in disgust or put a price on Without economic means, our Noxolo’s are Dube’s head, perhaps hear him out: his logic is forced to exploit all they have to survive, and all really rather sound. Picture a ship nearly wrecked they have is their bodies. Surely leaving the on the rocks near the Milton Sounds. One may multitudes of Noxolo’s without help must be one be tempted to quickly teach “the least of these” – of the great sins of mankind. Which is precisely single moms with children, and others unable to why “Women in Enterprise” is so necessary: we swim - to skilfully skipper a lifeboat safely to simply must empower such women to take shore and take control of their destiny; which is control of their destiny by releasing them from precisely what one should do if you wanted to kill their economic dependence. Which is why the them all. If one wanted to balance out the Women’s’ Development Banks of this world have disproportionate power held by the weak (those such a noble task: providing “the least of these” unable to make it to shore without help) versus our people (in terms of provision and means) with strong (those able), this is possibly the most the skills and means to succeed in enterprise - of counterproductive possible strategy. The strong any size and sort, though mostly small and swimmers will make it to shore anyway: they can simple – and so live with dignity and hope that swim, after all; it is only the weak that will drown their children will have a better life. Kudos to you: when the lifeboats flounder in the towering swells Women’s Development Bank. That’s the micro for lack of an able skipper. It’s always the most level, personal view. vulnerable who lack buffers (savings, assets, 1|Page
  38. 38. skills, education, etc) to shield themselves from This is precisely why we will never make major the consequences of well intentioned foolishness. dents in our unemployment rates by throwing all The hope of the “least of these” is in lifeboats our resources at supporting micro- and start-up making it safely to shore: the colour or creed of enterprises, either for women or for men. It takes the skipper is really immaterial; his skill as a so long to train enough people disadvantaged by skipper is not. So, the best way to help the weak the Bantu Education System to run businesses is to put the most qualified and able seamen at able to provide sustainable employment for even the helm of every lifeboat to whisk them all safely a few, that by the time they are all trained up the to shore as quickly as possible. Being the best ship has been sunk and the moms’ and toddlers’ skipper is not a matter of race or sex; it is a lifeless corpses lie washed up on the beach of matter of past training. Now is not the time to starvation. In enterprise, to help the weak, we train new captains. Now is the time to use those must help the strong. C’est la vie. Such is life. who have been raised up for times such as these. Lest you think my analogy to be the sly sleight of a self-interested hand, let’s put the example To ground the analogy, let’s look at Mao’s China. above into well-researched terms. In general, I am quite certain Mao Zedong had the best helping the least of these in enterprise limits one interests at heart of the very peasants who to supporting micro- and start-up enterprises – starved to death in their tens of millions, when He primarily due to the high complexity of starting launched the Great Leap Forward. Yet it was not and running a business, and the low skill and he or his high ranking government officials who education levels and limited capital in the hands suffered for their failed policies; it was “the least of “the least of these”. Supporting micro- of these” who had no buffer to fend off hunger enterprises can really only address up to 10% of and poverty when they assaulted the land in a our unemployment problem, and supporting start- frenzied swarm due to anti-individualistic ups another 10% (and then only if successful on agricultural policies. It was only years after this a grand scale!), due to low levels of unintentional genocide that these Communists entrepreneurialism and poor success rates of with a special disdain for individualism conceded micro- and start-up enterprises. that to help the weak they must help the strong. There is no avoiding it. It’s a pet law of Life. To one is given the gift of labour, to another the gift of enterprise, and to each the gift of the other. The more individualistic approach, then, is to make none gifts to others and assume all are equipped for all tasks, including enterprise, and so rob all of all. And Mao will shout his disagreement from his regretful grave. Similarly, in the struggling vessel of our market economy, Noxolo invariably suffers the most when the cold and heartless waves of poverty crash ceaselessly over the helm. While Noxolo’s boyfriends would be described by the World Bank as poor, they at least can swim (SA offers more * Will create over 20 jobs in 5 years jobs for men, such as manual labour in mines, construction, and public works, and there are This approach to enterprise will therefore fail to many more single moms than single dads) and help the vast majority of our Noxolo’s. Though use their economic means to exploit Noxolo, who this sort of support for “Women in Enterprise” is is truly impoverished by her absolute lack of certainly a part of the answer, a disproportionate protection from the battering waves of violent focus on this piece of the solution is merely a crime and exploitation which almost always denial of our responsibility to tackle the heart of overwhelm the weak in the dark night of the the disenfranchisement problem. poverty storm. The best way to empower Noxolo is through the blue skies of economic opportunity. The bulk of our solution cannot – empirically - lie What Noxolo needs is well-trained skippers who in this approach to enterprise development. To can safely navigate the vessels of private overcome our high unemployment rates, we must enterprise through the storm of poverty into job- support growth enterprises: significant small and creating prosperity medium sized businesses, with the potential to grow quickly and employ 20-2000 people. The truth is that, as much as the individual 2|Page
  39. 39. entrepreneur may be the visible icon of prosperity Women in Enterprise and black empowerment at the helm of his/her successful enterprise, with and the many other crucial programs which well-picked businesses, the benefits of growth to redress our past (gross) injustices, our progress poor people can be 20 times the benefit to the in this regard will be in direct proportion to the entrepreneur, in terms of annual increases in amount of financial and human capital well income (and far greater in terms of quality of life). invested in economically productive programs, So if helping Noxolo by helping able skippers and so it is simply counterproductive to willingly means supporting 80% male skippers and only discard much of our human capital (those trained 20% female, since at present most of our trained males with much education, skills and skippers are males, then C’est la vie – let us not experience) at the outset of the journey, because sink Noxolo and her toddlers over this spat. If we of race, sex, or creed. And here lies one of those are more true to the ends of helping our Noxolo’s distasteful truths that “Women in Enterprise” will than the means of Women in Enterprise, then we not allow us to sidestep: the unavoidability of the must happily accept supporting the entrepreneurs fate of the weak depending on the fate of the we have, whoever they may be. strong, who certainly in South Africa’s case are also mostly beneficiaries of apartheid. While it may irk the well-intentioned social conscience to focus efforts on multiplying the Let us again consult communist China, since we wealth of already well-to-do businessmen, the know they have no hidden agenda to bolster the reality Dube devoutly proclaims is this: cause of capitalism and individual enterprise. For disenfranchised women are by far the greatest all their disdain of that which reeks of elitism, they beneficiaries of pro-poor, job creating growth (in have been unable to avoid employing the very terms of improved quality of life); the greatest centre of the capitalist model at the heart of their driver of job-creating growth will be a flourishing economic strategy: private enterprise growth-enterprise sector; a flourishing growth- spearheaded by individual entrepreneurs and enterprise sector must, statistically, be headed by “Rainmakers” who, through personal success, effective entrepreneurs and business managers; drive development and prosperity for many. these are most likely to be relatively well- Though pure communist philosophy is nauseated educated and already highly able, with relevant by “individualism”, “elitism”, and the skills and experience – particularly in business - disproportionate enrichment of a relative few, and access to capital (human and financial); and after decades of various communal efforts, a finally, if we must lay all the politically distasteful “socialist market economy” is the way forward for cards on the table, these are statistically mostly China. That is, “we concede that we need going to be white males in South Africa. History entrepreneurs who become wealthy in order to does not forget. generate development and create jobs, but we want to distribute the benefits of their successes as widely as possible”. And in China, as in South Africa, these privileged catalysts of development happen mostly to be already advantaged males. This is not to say that women have no place in serious enterprise! With women like Janet Buckland, Thabang Molefi, Mardia van der Walt- Korsten and Chici Maponya about, watch out Tokyo! But on aggregate, we have as a nation more vested human capital in trained males than in females (again, history does not forget), and so we should expect that trained males continue to lead the charge of growth enterprises, if we expect to create jobs for our Noxolo’s. It is not about human potential; it is about human capital: So supporting the best entrepreneurs and that crucial driver of successful enterprise, which business managers is the most powerful way to is the existing availability in a human soul of help the most Noxolo’s, and these will mostly be education and skill, a swift, creative mind and males. Hardly a poster child for a “Women in proactive spirit, and a vision or dream that fuels Enterprise development” success story, but the constant energy required to “sukkle” through pragmatically it’s your best bet to help our hard times. There is no substitute for the slow Noxolo’s. What Dube will tell you in a moment of process of sowing education and experience to blind valour is that, while we must support reap human capital, and no substitute for sowing 3|Page
  40. 40. human capital to reap successful enterprise and jobs. Where does this leave us on Women in Enterprise? As with all tensions: with a question to be answered by brave people in high places. The starting point must be our finite resources: we cannot achieve all; we must prioritise our objectives and invest our scarce resources in that which counts most. Having limited resources does not mean we resign ourselves to the grooves history has carved for us and leave women on the fringes of the economy: it means we must choose where change is most important. So the question is simply this: Which is more important: having several thousand fewer Noxolo’s, or several tens more Chici’s? Much fewer women starving, or a few more women at the top? The opportunity cost of doing either is unavoidable. We have limited Rands and we will neither reach the end of helping our Noxolo’s nor create as many Chici’s as there are Tokyo’s in this century, so every Rand spent on one is a Rand not spent on the other. Which is more important? Like I said: not for sissies. 4|Page
  41. 41. Time for Africa’s Green Can you imagine waking up wondering how to clean yourself before going hungry all day, Revolution because you have no water? Can you imagine asking your parents where to fall “Once upon a time there was a tiny, tiny chicken sleep hungry, because you have no shelter? named Chicken Little. One day Chicken Little was Can you imagine brainstorming where to find scratching in the garden when an acorn fell on her shelter with 5 hungry younger siblings because head. ‘Oh,’ cried Chicken Little, ‘the sky is falling. I you have no parents? must go tell the king.’ So Chicken Little ran and Can you imagine all you have is 5 hungry siblings ran, and she met Henny Penny. ‘Where do you to take care of, and you have no parents, no travel so fast, Chicken Little?’ asked Henny Penny. shelter, no water, no food, no work, no skills, no ‘Ah, Henny Penny,’ said Chicken Little, ‘the sky is car, and no home? falling, and I must go tell the king.’” Can you imagine that - even if you find some work this morning, beg some money this afternoon - I often wake up wondering if I am not in fact Henny tomorrow is the same again and so, having been Penny, only a little bigger and far more masculine. stripped of all else, you are stripped even of hope? There seem to be so many Chicken Little’s with mighty megaphones and their own tales of doom that I really begin to wonder if perhaps it isn’t true: could the sky really be falling in on our nice little Food crisis at a personal level world? Sometimes Chipo manages to find small jobs – It only takes a brief foray into the fairly straight- carrying water, a bit of farm work here and there – forward question “how do we feed Africa?” to so she can buy some maize and some cooking oil become quite overwhelmed with early symptoms of for her siblings. There's never enough to stop the sky-falling-in-ism . People need food. Food comes hunger, of course. But mostly there's enough to from the ground. Africa has lots of ground. What’s live. She's used to the hunger by now. It's the the problem? weakness – the struggle to do things – that still bothers her. There's so much work to do. So much. Follow me if you will through the labyrinth that is 5 siblings, and they're all under 13. What can they Africa’s hunger crisis... do? Not much. And they give so many problems. They aren't disciplined and they don't listen. They don't want to help and they don't understand why Poverty it's important to learn. She can't blame them; they had to watch 2 of their parents dying very slowly. Chipo is now 17. She's Malawian . Chipo's parents They were so sick, and nobody knew what this both died of AIDS when she was 13. Since then, disease was. They just couldn't get out of bed. she's been raising 5 siblings on her own. Of Slowly, very slowly, they just died. So the children course, before she became the head of her have had nobody. Nobody to love them, and household, the medical bills swallowed up their nobody to love. Everybody in the area is struggling only "wealth" – a few goats and a small piece of enough, they can't feed extra mouths. It's hard land. So they have nothing. enough just to feed your own family. And nobody wants to look after an aids orphan. Aids orphans are a problem – they just get in the way and Have you ever had nothing? Can you fathom nobody can help. And that disease kills. Aids possessing nothing? orphans are dangerous; you must stay away from Can you imagine driving home from work them. Its better to chase them out of the area so wondering where to go, because you have no they don't make others sick. So the orphans have home? to look after themselves. Nobody to love. Nobody Can you imagine walking out of work wondering to be loved by. Only themselves. what to do because you have no car? Can you imagine sitting over breakfast wondering how to earn some money because you have no But Chipo now has a figment of hope: World Vision work and no skills? gave her a small piece of land, some goats and Can you imagine having an extended wash some seeds to grow corn. Some people have tried because you can’t face climbing out the shower to to take it away. Apparently only the big farmers can no food, no money, and no work? make money. Apparently the small ones just take up land and waste it. So they say we should go to 1 | Page
  42. 42. school so we can find work. They say school is like nothing. Instead Chipo puts a pot of hope on the property: if you have property you can live; if you fire. It’s empty of course, but at least the boiling have school you can live. I think they are right: like water lets the children fall asleep with hope - property, school is something only rich people can believing food is on the way - rather than crying have. How can an aids orphan go to school? When late into the night until eventually exhaustion will there be time to find food or work for money to triumphs over despair and the curtains are drawn eat? So one day there will be no school, no land, on yet another sad act in their living lampoon of and no hope. But today there is land, and while human tragedy. there is land there is hope. Maybe at harvest time, there will be enough to go through the whole year and not be hungry. But that never happens, A human tragedy because if we eat until there is no hunger today, then the hunger will just be worse tomorrow. We The United Nations defines hunger as a condition must keep some in case there is no food tomorrow. in which people lack the basic food intake to So there will always be hunger. But at least we will provide them with the energy and nutrients for fully live. productive, active lives. Abraham Maslow might say hunger is that state in which humans are denied even a sub-human existence - fulfilling Food crisis at a global level human potential is a dream; outwitting the faceless foe Hunger to live another day is the challenge of Shortly after World War II, when 500 million people the hour, every hour. I say mass-hunger is the faced famine in what came to be known as a point at which we who recline in our manicured “measureless calamity”, President Harry Truman of homes painting our toenails and working on our the USA said “more people face starvation and golf swing deny ourselves a human existence: even actual death for want of food today than in when we comfortably coexist with such gross any war year and perhaps more than in all the war levels of human suffering on such a grand scale - years combined.” Just over 60 years later we have as though it were a tedious flick with a dull plot and avoided further world wars, sent men to the moon, poor cast playing in the background - any pretence explored the far reaches of our solar system with of humanity being a just and peace-seeking race, space probes, cracked the human genetic code, elevated over the rest of creation by love and found ways to cure or control most diseases that compassion, seems simply absurd. We go to big plagued the last century, and reached the heights conferences in Doha to talk about fighting poverty; of human prosperity, but over the same period the we meet in Shanghai to pave the way for fair trade; number of starving people has doubled. There are we start blogs and write columns on the age of about 900 million Chipo’s in the world today: hope while with our lives we gaily flip to MTV and people who wake up hungry and go to bed hungry drown out the weak groans of continents of every day. 3.5 million children under the age of 5 starving infants. There is more at stake here than die of hunger each year. 32% of all children under statistics. Our humanity is at stake. Our souls are five worldwide have irreparably stunted physical at stake. How will our souls rest with the deafening and mental growth due to hunger. They will simply cries of starving children ever in our ears? We never catch up. That number is 40-50% in most of simply must conquer this faceless foe, Herr Africa. Hunger! And hunger levels are not falling; they are escalating. The number of Chipo’s grew by The nature of the Hunger crisis 122million people in 2007 – that’s nearly 3 South Africa’s of new Chipo‘s in a single year. Admittedly, Now Herr Hunger is no longer so mysterious that it was an anomaly of a year, after several years of He can’t be fought. For many long centuries he incremental improvement. But the overall trend is roamed the hills in the open day declaring his worsening. Escalating food prices, escalating fuel purpose and ploys. Our forefathers suffered at his prices, and various other side-effects of our hands but later learnt to fortify their rural globalised Babel are taking their toll. From January economies to guard their kin from his hungry paws 2006 to January 2008, rice prices tripled; wheat of destruction. We have all their wisdom and and maize more than doubled. The world’s poorest weaponry at our disposal. Why the failure to share people spend up to 70% of their income on food our liberty from this merciless, soul devouring alone, so when food prices double, they simply eat beast with the vast numbers of our vulnerable 3 fewer days a week. “Let them eat cake”, we cry brethren? when the bread runs out. Well they have no cake; they have no bread; they have more or less 2 | Page

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